Latest Edition of Mitchell's Industry Trends Report Shows Relationship Between Fuel Price Spikes and Total Losses - BodyShop Business

Latest Edition of Mitchell’s Industry Trends Report Shows Relationship Between Fuel Price Spikes and Total Losses

Mitchell International, Inc., a leading provider of technology, connectivity and information solutions to the property and casualty claims and collision repair industries, today released the third quarter 2011 edition of its Industry Trends Report (ITR) – the company’s quarterly publication that highlights industry-related trends, news items and statistics.

In this ITR, Mitchell’s quarterly feature discusses how volatile and sustained high fuel prices are impacting insurance claims – beyond a reduction in miles driven. Specifically, the article discusses how this phenomenon, along with market reaction time, or the delay between the rise in fuel prices and the rise in value of the most fuel efficient vehicle, is affecting total loss values.
 
This edition’s quarterly feature, "Timing is Everything: Total Loss Values and Gas Prices," by Mitchell’s Vice President of Industry Relations Greg Horn, delves into Mitchell’s Total Loss Valuation Data Warehouse to explain how rapid changes to the price of gasoline this year are impacting resale values for fuel efficient cars, hybrids and – at the other end of the spectrum – gas guzzlers differently.
 
"To determine the relationship between fuel price spikes and values, we examined the Toyota Corolla, Prius and the Ford Expedition as representatives of the fuel efficient, hybrid and gas guzzler vehicle categories," said Horn. "Our claims data fell in line with other reports and market sources and did show that fuel efficient vehicles tend to rise more quickly and reliably in value during periods of high prices than gas guzzlers, which fall in value."
 
Horn added, "Significantly, our analysis showed a market reaction time during fuel price volatility of approximately three weeks – a delay between the rise in fuel prices and the rise in value of the most fuel efficient vehicle in our study, which was a hybrid. Gas guzzlers, which are traditionally more volatile during fuel price fluctuations, showed a similar lag pattern. The insurance and collision repair industries need the accuracy of a true market survey method for valuing a total loss because constantly fluctuating fuel prices move too fast, with too great an impact, for slower traditional ‘book value’ valuations to accurately reflect the true actual cash value of total loss vehicles."
 
Other valuable points of interest in the current issue of Mitchell’s ITR include:

• Mitchell’s Q2-2011 data reflect an initial average gross collision appraisal value of $2,761 – $90 less than this same period last year. However, applying the indicated development factor of 9 percent suggests a final Q2-2011 average gross collision appraisal value of $3,008. The average Actual Cash Value (ACV) of vehicles appraised for collision losses during Q2-2011 was $13,705 – an increase of $500 over the same period last year.

• In Q2-2011, the average gross appraisal value for comprehensive coverage estimates processed through Mitchell servers was $2,854 – compared to $2,625 in Q2-2010. Applying the prescribed development factor of 1 percent for this data set produces an increase in the adjusted value to $2,883 – reflecting the strong storm season with many hail claims. 


More information:

Download the Industry Trends Report in PDF format

You May Also Like

Cruise Postpones Release of Driverless Taxi Service

Cruise, a GM subsidiary, recently announced that it will miss its goal of launching a large-scale self-driving taxi service in 2019.

Cruise, a GM subsidiary, recently announced that it will miss its goal of launching a large-scale self-driving taxi service in 2019. Cruise CEO Dan Ammann said the company plans to dramatically increase the number of its autonomous test vehicles on the road in San Francisco, but will not be offering rides to regular people this year, according to an article from The Verge.

Cutting Edge Automotive Solutions Partners with Andretti Rallycross

Andretti Rallycross announced that Cutting Edge Automotive Solutions will serve as technical partner on Cabot Bigham’s No. 02 OINK Clothing Beetle for the remainder of the 2019 Americas Rallycross season, showcasing their SP Tools USA brand.

Ford, Volkswagen Expand Collaboration to Include Autonomous, Electric Vehicles

Ford Motor Company and Volkswagen AG announced they are expanding their global alliance to include electric vehicles – and will collaborate with Argo AI to introduce autonomous vehicle technology in the U.S. and Europe.

CCAR Updates Website with More OSHA Alliance Resources

CCAR (Coordinating Committee For Automotive Repair) has announced the addition of new Occupational Safety and Health Administration (OSHA) Alliance content on its main website, www.ccar-greenlink.org.

CARSTAR McLaren Lake Forest and CARSTAR McLaren Irvine Open in California

Owned by husband-and-wife team James and Mary Davis, CARSTAR McLaren Lake Forest and CARSTAR McLaren Irvine are a family business.

Other Posts

CIECA to Offer Webinar on What Businesses Need to Know to Implement CIECA Standards

CIECA will hold its next CIECAst webinar, “Implementing CIECA Standards: Implementation Guide and Appendix C – BMS, Code Lists and Shema Components,” on Tuesday, Dec. 11, 2018 at 11 a.m. CST.

CARSTAR Urges Customers to Stay Winter Ready

Cold weather can create some of the harshest driving conditions of the year. The months between October and February top the list for accidents, vehicle damage and injuries.

CIECA Adds Broadly as Corporate Member

The Collision Industry Electronic Commerce Association (CIECA) announced that Broadly has joined CIECA as a corporate member.

NABR Launches BillableGenie Online Searchable Database of Insurer-Paid Not-Included Procedures

National AutoBody Research (NABR) has announced the launch of its BillableGenie online service, an independent, centralized source of actual data on insurer paid not-included procedures and operations, labor rates, labor rate concessions and other manually entered estimate line items.